Welcome!

Agile Computing Authors: Elizabeth White, Zakia Bouachraoui, Pat Romanski, Dana Gardner, Yeshim Deniz

Related Topics: Agile Computing

Agile Computing: Article

How Can Metcalfe's Law Be Updated for Web 2.0?

Metcalfe's Law is More Misunderstood Than Wrong

"Metcalfe's Law is Wrong," contended Bob Briscoe, Andrew Odlyzko, and Benjamin Tilly recently in a much-discussed IEEE Spectrum article, in which they wrote: "Of all the popular ideas of the Internet boom, one of the most dangerously influential was Metcalfe's Law." Sim Simeonov disagrees.

The industry is at it again – trying to figure out what to make of Metcalfe’s Law. This time it’s IEEE Spectrum with a controversially titled “Metcalfe’s Law is Wrong”. The main thrust of the argument is that the value of a network grows O(nlogn) as opposed to O(n2). Unfortunately, the authors’ O(nlogn) suggestion is no more accurate or insightful than the original proposal.

There are three issues to consider:

  • The difference between what Bob Metcalfe claimed and what ended up becoming Metcalfe’s Law
  • The units of measurement
  • What happens with large networks

The typical statement of the law is “the value of a network increases proportionately with the square of the number of its users.” That’s what you’ll find at the Wikipedia link above. It happens to not be what Bob Metcalfe claimed in the first place. These days I work with Bob at Polaris Venture Partners. I have seen a copy of the original (circa 1980) transparency that Bob created to communicate his idea. IEEE Spectrum has a good reproduction, shown here.

The original Metcalfe's Law graph

The unit of measurement along the X-axis is “compatibly communicating devices”, not users. The credit for the “users” formulation goes to George Gilder who wrote about Metcalfe’s Law in Forbes ASAP on September 13, 1993. However, Gilder’s article talks about machines and not users. Anyway, both the “users” and “machines” formulations miss the subtlety imposed by the “compatibly communicating” qualifier, which is the key to understanding the concept.

Bob, who invented Ethernet, was addressing small LANs where machines are visible to one another and share services such as discovery, email, etc. He recalls that his goal was to have companies install networks with at least three nodes. Now, that’s a far cry from the Internet, which is huge, where most machines cannot see one another and/or have nothing to communicate about… So, if you’re talking about a smallish network where indeed nodes are “compatibly communicating”, I’d argue that the original suggestion holds pretty well.

The authors of the IEEE article take the “users” formulation and suggest that the value of a network should grow on the order of O(nlogn) as opposed to O(n2). Are they correct? It depends. Is their proposal a meaningful improvement on the original idea? No.

To justify the logn factor, the authors apply Zipf’s Law to large networks. Again, the issue I have is with the unit of measurement. Zipf’s Law applies to homogeneous populations (the original research was on natural language). You can apply it to books, movies and songs. It’s meaningless to apply it to the population of books, movies and songs put together or, for that matter, to the Internet, which is perhaps the most heterogeneous collection of nodes, people, communities, interests, etc. one can point to. For the same reason, you cannot apply it to MySpace, which is a group of sub-communities hosted on the same online community infrastructure (OCI), or to the Cingular / AT&T Wireless merger.

The main point of Metcalfe’s Law is that the value of networks exhibits super-linear growth. If you measure the size of networks in users, the value definitely does not grow O(n2) but I’m not sure O(nlogn) is a significantly better approximation, especially for large networks. A better approximation of value would be something along the lines of O(SumC(O(mclogmc))), where C is the set of homogeneous sub-networks/communities and mc is the size of the particular sub-community/network. Since the same user can be a member of multiple social networks, and since |C| is a function of N (there are more communities in larger networks), it’s not clear what the total value will end up being. That’s a Long Tail argument if you want one…

Very large networks pose a further problem. Size introduces friction and complicates connectivity, discovery, identity management, trust provisioning, etc. Does this mean that at some point the value of a network starts going down (as another good illustration from the IEEE article shows)? It depends on infrastructure. Clients and servers play different roles in networks. (For more on this in the context of Metcalfe’s Law, see Integration is the Killer App, an article I wrote for XML Journal in 2003, having spent less time thinking about the problem ;-) ). P2P sharing, search engines and portals, anti-spam tools and federated identity management schemes are just but a few examples of the myriad of technologies that have all come about to address scaling problems on the Internet. MySpace and LinkedIn have very different rules of engagement and policing schemes. These communities will grow and increase in value very differently. That’s another argument for the value of a network aggregating across a myriad of sub-networks.

Bottom line, the article attacks Metcalfe’s Law but fails to propose a meaningful alternative.

More Stories By Simeon Simeonov

Simeon Simeonov is CEO of FastIgnite, where he invests in and advises startups. He was chief architect or CTO at companies such as Allaire, Macromedia, Better Advertising and Thing Labs. He blogs at blog.simeonov.com, tweets as @simeons and lives in the Greater Boston area with his wife, son and an adopted dog named Tye.

Comments (6)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


IoT & Smart Cities Stories
The platform combines the strengths of Singtel's extensive, intelligent network capabilities with Microsoft's cloud expertise to create a unique solution that sets new standards for IoT applications," said Mr Diomedes Kastanis, Head of IoT at Singtel. "Our solution provides speed, transparency and flexibility, paving the way for a more pervasive use of IoT to accelerate enterprises' digitalisation efforts. AI-powered intelligent connectivity over Microsoft Azure will be the fastest connected pat...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
Atmosera delivers modern cloud services that maximize the advantages of cloud-based infrastructures. Offering private, hybrid, and public cloud solutions, Atmosera works closely with customers to engineer, deploy, and operate cloud architectures with advanced services that deliver strategic business outcomes. Atmosera's expertise simplifies the process of cloud transformation and our 20+ years of experience managing complex IT environments provides our customers with the confidence and trust tha...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
As you know, enterprise IT conversation over the past year have often centered upon the open-source Kubernetes container orchestration system. In fact, Kubernetes has emerged as the key technology -- and even primary platform -- of cloud migrations for a wide variety of organizations. Kubernetes is critical to forward-looking enterprises that continue to push their IT infrastructures toward maximum functionality, scalability, and flexibility. As they do so, IT professionals are also embr...
CloudEXPO has been the M&A capital for Cloud companies for more than a decade with memorable acquisition news stories which came out of CloudEXPO expo floor. DevOpsSUMMIT New York faculty member Greg Bledsoe shared his views on IBM's Red Hat acquisition live from NASDAQ floor. Acquisition news was announced during CloudEXPO New York which took place November 12-13, 2019 in New York City.
AI and machine learning disruption for Enterprises started happening in the areas such as IT operations management (ITOPs) and Cloud management and SaaS apps. In 2019 CIOs will see disruptive solutions for Cloud & Devops, AI/ML driven IT Ops and Cloud Ops. Customers want AI-driven multi-cloud operations for monitoring, detection, prevention of disruptions. Disruptions cause revenue loss, unhappy users, impacts brand reputation etc.
After years of investments and acquisitions, CloudBlue was created with the goal of building the world's only hyperscale digital platform with an increasingly infinite ecosystem and proven go-to-market services. The result? An unmatched platform that helps customers streamline cloud operations, save time and money, and revolutionize their businesses overnight. Today, the platform operates in more than 45 countries and powers more than 200 of the world's largest cloud marketplaces, managing mo...
In an age of borderless networks, security for the cloud and security for the corporate network can no longer be separated. Security teams are now presented with the challenge of monitoring and controlling access to these cloud environments, at the same time that developers quickly spin up new cloud instances and executives push forwards new initiatives. The vulnerabilities created by migration to the cloud, such as misconfigurations and compromised credentials, require that security teams t...